7-Business: Brazil black market in GM soybeans booming

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TITLE:  Brazil black market in GM soybeans booming
SOURCE: Reuters, by Reese Ewing
DATE:   August 9, 2001

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INTERVIEW - Brazil black market in GM soybeans booming

SAO PAULO, Brazil - In Brazil, the world's No. 2 soybean grower and 
exporter after the United States, a ban on genetically modified crops has 
created a thriving black market in bioengineered soybeans that is bringing 
conventional seed suppliers to their knees, an industry official said 
yesterday.

The director of Brazil's Seed Producers Association (Abrasem), Joao 
Henrique Hummel, told Reuters in an interview he estimated that plantings 
of GM soy have doubled in the country since last year.

This has occurred even as the environmental group Greenpeace has battled 
against government attempts to legalize GM products.

"Farmers in Brazil have two options: they can buy legal, conventional seeds 
or illegal transgenic seeds, and in Rio Grande do Sul state for example 
they now prefer to buy the illegal GM soybeans to plant," said Hummel.

Smugglers have been trucking GM beans for at least three years across the 
porous southern border of Rio Grande do Sul, Brazil's No. 3 soy state, from 
Argentina, one of the world's top growers of GM soybeans, because Brazilian 
farmers see GM seeds as a cost-saving product, said Hummel.

In 2000, Abrasem estimated that the planting of GM soy had reached about 30 
percent of Rio Grande do Sul's total area sowed in the profitable oil seed. 
But Hummel said this figure had since grown to over 60 percent.

"Three years ago state-registered seed growers in Rio Grande do Sul alone 
produced 300,000 tonnes of soybeans to plant. This year production dropped 
to 100,000," said Hummel.

However, the state's production levels have remained fairly stable over the 
last few years, indicating that the parallel seed market now accounts for 
almost two-thirds of the state's crop, said Hummel.

The government has threatened in the past to set fire to fields found with 
GM soybeans, but has never done so and instead has largely turned a blind 
eye to the rampant growth in GM plantings.

IRONY OF ILLEGAL GM SEEDS IN BRAZIL

The consumer and environmental groups that have been effectively blocking 
biotechnology companies like Monsanto Co. from selling its Roundup Ready 
products in Brazil have failed to dissuade farmers from turning to the 
black market.

As a result, they are ordering less non-GM seed from certified seed growers 
which threatens to destroy the industry and its conventional crop research 
efforts in Brazil.

"Profit margins for the certified seed producers are shrinking. It is a 
life or death issue for the seed industry which relies on these revenues to 
fund research in new seed development," added Hummel.

Monsanto's Roundup Ready varieties of GM soybeans are designed to withstand 
the company's Roundup Ready herbicide, which requires fewer crop 
applications to destroy weeds, and thus costs less than conventional 
herbicides.

The clandestine GM soybeans are not being separated from the rest of 
Brazil's allegedly GM-free soy crop, for as one Rio Grande do Sul soybean 
trader put it, "Why should the government track or cooperatives make 
special room for something that is not legally supposed to be there anyway."

So far the government has been ineffectual at finding its way through the 
labyrinth of court injunctions that Greenpeace and local consumer rights 
groups have slapped on Monsanto.

"If Brazil lifts its ban on GM soybeans, registered seed growers could 
easily produce better quality GM seeds at lower prices than the black 
market can offer," Hummel said.

He said that only after registered seed growers began producing GM seeds 
would it be possible to track and register GM soybeans in Brazil.

Brazil's reputation as a non-GM food producer has won it healthy premiums 
from buyers in Asia and Europe, where consumers have been most resistant to 
bioengineered foods.

"GM beans are showing up in new regions of Brazil outside the South. It 
only takes a planting of 50 hectares (125 acres) to create enough GM seed 
to plant 3 million hectares (7.5 million acres) in three years," Hummel 
noted.



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